Correlation Between Nuveen Strategic and Saat Defensive
Can any of the company-specific risk be diversified away by investing in both Nuveen Strategic and Saat Defensive at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Nuveen Strategic and Saat Defensive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen Strategic Municipal and Saat Defensive Strategy, you can compare the effects of market volatilities on Nuveen Strategic and Saat Defensive and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nuveen Strategic with a short position of Saat Defensive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen Strategic and Saat Defensive.
Diversification Opportunities for Nuveen Strategic and Saat Defensive
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nuveen and Saat is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen Strategic Municipal and Saat Defensive Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Defensive Strategy and Nuveen Strategic is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nuveen Strategic Municipal are associated (or correlated) with Saat Defensive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Defensive Strategy has no effect on the direction of Nuveen Strategic i.e., Nuveen Strategic and Saat Defensive go up and down completely randomly.
Pair Corralation between Nuveen Strategic and Saat Defensive
Assuming the 90 days horizon Nuveen Strategic is expected to generate 1.01 times less return on investment than Saat Defensive. In addition to that, Nuveen Strategic is 1.77 times more volatile than Saat Defensive Strategy. It trades about 0.07 of its total potential returns per unit of risk. Saat Defensive Strategy is currently generating about 0.12 per unit of volatility. If you would invest 857.00 in Saat Defensive Strategy on October 23, 2024 and sell it today you would earn a total of 76.00 from holding Saat Defensive Strategy or generate 8.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen Strategic Municipal vs. Saat Defensive Strategy
Performance |
| Timeline |
| Nuveen Strategic Mun |
| Saat Defensive Strategy |
Nuveen Strategic and Saat Defensive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen Strategic and Saat Defensive
The main advantage of trading using opposite Nuveen Strategic and Saat Defensive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen Strategic position performs unexpectedly, Saat Defensive can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Saat Defensive will offset losses from the drop in Saat Defensive's long position.| Nuveen Strategic vs. Barings Global Floating | Nuveen Strategic vs. Ab Global Bond | Nuveen Strategic vs. Mirova Global Green | Nuveen Strategic vs. Tax Managed Large Cap |
| Saat Defensive vs. Nuveen Strategic Municipal | Saat Defensive vs. Transamerica Intermediate Muni | Saat Defensive vs. Bbh Intermediate Municipal | Saat Defensive vs. Lord Abbett Intermediate |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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